Interior Department awards $15.1M for air transport, with 5 bidders competing for the contract

Contract Overview

Contract Amount: $15,117,504 ($15.1M)

Contractor: AIR Center Helicopters, Inc

Awarding Agency: Department of the Interior

Start Date: 2003-07-15

End Date: 2008-11-01

Contract Duration: 1,936 days

Daily Burn Rate: $7.8K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 5

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT

Sector: Other

Official Description: NAVY-FT. WORTH, TX

Place of Performance

Location: FORT WORTH, TARRANT County, TEXAS, 76106

State: Texas Government Spending

Plain-Language Summary

Department of the Interior obligated $15.1 million to AIR CENTER HELICOPTERS, INC for work described as: NAVY-FT. WORTH, TX Key points: 1. Value for money appears reasonable given the fixed-price structure with economic adjustments. 2. Strong competition with five bidders suggests a healthy market for air charter services. 3. Contract duration of over 5 years indicates a need for sustained service. 4. The service is critical for supporting operations in remote or inaccessible areas. 5. This contract falls within the broader category of transportation and logistics support for federal agencies.

Value Assessment

Rating: good

The contract value of $15.1 million over approximately 5 years suggests a moderate annual spend. Benchmarking against similar contracts for nonscheduled chartered passenger air transportation is difficult without more specific route and aircraft details. However, the fixed-price with economic price adjustment structure aims to control costs while accounting for market fluctuations. The presence of five bidders indicates a competitive environment that likely drove a fair price.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, with five distinct bidders vying for the opportunity. This level of competition is generally positive, suggesting that multiple capable vendors were aware of and able to respond to the requirement. The diversity of bidders can lead to better price discovery and potentially more innovative solutions.

Taxpayer Impact: A competitive award process like this is beneficial for taxpayers as it helps ensure the government is not overpaying for essential services and encourages vendors to offer their best pricing.

Public Impact

Federal agencies, particularly those operating in remote areas like the Department of the Interior, benefit from reliable air transportation. The service provides nonscheduled chartered passenger air transportation, crucial for personnel movement and operational support. The contract's geographic impact is primarily within Texas, as indicated by the awardee's location and state code. Workforce implications include employment for pilots, ground crew, and support staff associated with AIR CENTER HELICOPTERS, INC.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for price increases due to economic price adjustment clause if market conditions are volatile.
Dependence on a single contractor for a critical service over a long duration could pose a risk if performance issues arise.

Positive Signals

Awarded through full and open competition, indicating a robust bidding process.
Fixed-price contract structure provides cost predictability, with adjustments for economic factors.
Contractor has secured a significant award, suggesting a level of established capability.

Sector Analysis

The air transportation sector is vital for government operations, enabling movement of personnel and resources to areas not served by conventional transport. This contract for nonscheduled chartered passenger air transportation fits within the broader aviation services market. Comparable spending benchmarks would depend on the specific type of aircraft, flight hours, and operational tempo required, but the $15.1M over 5 years represents a substantial, albeit niche, federal investment in specialized air mobility.

Small Business Impact

This contract was not set aside for small businesses, and there is no indication of subcontracting requirements for small businesses within the provided data. The award went to AIR CENTER HELICOPTERS, INC., which may or may not be a small business itself, but the procurement mechanism did not prioritize small business participation.

Oversight & Accountability

Oversight for this contract would typically fall under the Department of the Interior's contracting officers and program managers. Accountability measures are inherent in the fixed-price contract terms, requiring delivery of services as specified. Transparency is facilitated by the public nature of federal contract awards, though detailed performance metrics are not publicly disclosed.

Related Government Programs

General Services Administration (GSA) Schedules for transportation services
Department of Defense (DoD) airlift and charter services
Department of Homeland Security (DHS) aviation support
Bureau of Land Management (BLM) aviation operations
U.S. Forest Service (USFS) aerial firefighting and support

Risk Flags

Long contract duration increases exposure to market volatility and performance risk.
Economic price adjustment clause could lead to cost overruns if not carefully monitored.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Interior awarded $15.1 million to AIR CENTER HELICOPTERS, INC. NAVY-FT. WORTH, TX

Who is the contractor on this award?

The obligated recipient is AIR CENTER HELICOPTERS, INC.

Which agency awarded this contract?

Awarding agency: Department of the Interior (Departmental Offices).

What is the total obligated amount?

The obligated amount is $15.1 million.

What is the period of performance?

Start: 2003-07-15. End: 2008-11-01.

What is the typical cost per flight hour or per passenger mile for nonscheduled chartered passenger air transportation in Texas?

Determining a precise per-unit cost benchmark for nonscheduled chartered passenger air transportation in Texas is challenging without specific details about the aircraft type, range, passenger capacity, and operational context (e.g., mission type, duration, frequency). However, general market rates can vary significantly. For instance, chartering a small helicopter might range from $1,500 to $5,000 per hour, while larger fixed-wing aircraft could cost $5,000 to $15,000+ per hour. Passenger mile costs are even more variable. Given the $15.1 million award over approximately 1936 days (roughly 5.3 years), the average annual spend is around $2.85 million. If we assume a significant number of flight hours per year, the per-hour rate would need to be competitive within the market for the specific services rendered. The fixed-price with economic price adjustment structure suggests an effort to stabilize costs while allowing for market fluctuations.

How does the number of bidders (5) compare to similar federal air charter contracts?

A competition with five bidders for a federal contract of this nature (nonscheduled chartered passenger air transportation) generally indicates a healthy level of market interest and capability. While the 'average' number of bidders can fluctuate based on contract complexity, value, and specific service requirements, five bidders suggests that the opportunity was sufficiently attractive and accessible to multiple vendors. Contracts with fewer than three bidders might raise concerns about market saturation or barriers to entry, whereas significantly higher numbers could indicate a very commoditized service or a broad, less specialized requirement. For specialized or high-value contracts, five bidders often represents a robust competitive landscape that should yield fair pricing and good performance.

What are the potential risks associated with a fixed-price contract with economic price adjustment (FPEPA) for air transportation?

The primary risk with a Fixed-Price contract with Economic Price Adjustment (FPEPA) for air transportation lies in the potential for cost escalation beyond initial projections, even with the adjustment clause. While the FPEPA aims to protect both parties from unforeseen market shifts (e.g., fuel price volatility, labor cost increases), the government still bears the risk of significant price increases if economic factors drive up the contractor's costs substantially. The contractor is protected from losses due to these external factors, but the government might end up paying more than initially budgeted if the economic adjustments are large. Effective oversight requires careful monitoring of the economic indicators used for adjustment and ensuring they accurately reflect actual cost changes.

What is the track record of AIR CENTER HELICOPTERS, INC. in performing federal contracts?

Information regarding the specific track record of AIR CENTER HELICOPTERS, INC. in performing federal contracts is not detailed in the provided data snippet. However, securing a $15.1 million contract through full and open competition suggests a demonstrated capability to meet federal procurement requirements and likely a history of successful operations. To fully assess their track record, one would need to examine their past performance evaluations on federal contracts (e.g., through the Contractor Performance Assessment Reporting System - CPARS), review any past disputes or contract terminations, and verify their financial stability and operational capacity relevant to the scope of this award.

How does the duration of this contract (1936 days) impact its overall value and risk?

The contract duration of 1936 days (approximately 5.3 years) is substantial for a service contract like nonscheduled chartered passenger air transportation. This extended period provides stability and predictability for both the government and the contractor, allowing for better long-term planning and potentially fostering a stronger working relationship. For the government, it ensures continuity of service. However, a longer duration also increases the overall financial commitment and the potential impact of any performance issues or unforeseen market changes. The fixed-price with economic price adjustment structure helps mitigate some financial risk over this extended period by allowing for adjustments based on market conditions, but the government remains exposed to potential cost increases.

Industry Classification

NAICS: Transportation and Warehousing › Nonscheduled Air Transportation › Nonscheduled Chartered Passenger Air Transportation

Product/Service Code: TRANSPORT, TRAVEL, RELOCATION › TRAVEL, LODGING, RECRUITMENT SVCS

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Offers Received: 5

Pricing Type: FIXED PRICE WITH ECONOMIC PRICE ADJUSTMENT (K)

Contractor Details

Address: 150 AVIATION WAY HNGR 17N, FORT WORTH, TX, 90

Business Categories: Category Business, Small Business

Financial Breakdown

Contract Ceiling: $37,395,757

Exercised Options: $21,415,640

Current Obligation: $15,117,504

Timeline